There is more to the story when you focus on your double bottom line.
So many nonprofits forget to use the presentation of their financials as a means to inspire and highlight the double bottom line. They opt, instead, to merely report.
This is especially true of association systems—organizations that have chapters, affiliates, congregations, franchises, clubs, etc, each with its own 501(c)3 and board of directors. In an association system each local affiliate is its own organization and is allowed to “fly the flag” of the organization’s brand because of fees and resource sharing between the local and national offices.
The result, as with all franchised (association) systems, is a double bottom line rather than a single one. BOTH the national office and the regional office have their own balance sheet, audited financials, donor databases, etc. And, each reports individually.
At the national level, it tends to be a report that says this is what we received and spent, and oh yes, local affiliates receive and spend money too which we aren’t reporting here.
At the regional level, it tends to be a report that says this is what we received and spent, and oh yes, this is what our dues cost us, which go toward a larger effort that we are not reporting here.
Most donors do not make this distinction. They are prepared to give to the mission and aren’t thinking about which entity receives and receipts it. It is all one entity, regardless of which doorway was walked through to the organizational relationship (one big exception to this are organizations with support raising “missionaries” where the primary relationship is often with the person rather than the organization. Even then, however, the problematic dynamics of reporting for the individual rather than demonstrating the mission for the whole, remain).
Think of it as going to the store to get milk. As a consumer, you want the milk you want when you want it. You aren’t thinking about all the inputs and involved entities that get it there unless the milk you wanted wasn’t there. The advertising that says your local grocer has milk that you want doesn’t provide a detailed listing of the hay provider, the cow’s name, the dairy farmer, the pasteurizing equipment manufacturer, the transportation and packaging companies and the ultimate vendor to you. It simply says “we have it” and the price.
All this to say, the association system is well-served to describe their whole economy, including all its entities, and to aggregate and then accurately interpret both bottom lines into a single number for their report and public communication. It is much easier to communicate mission effectiveness and scope of impact in this way.
The regional body/chapter/franchise can do this also, pointing to what it means to be part of a national or international mission, reinforcing the relationships to continue long after current leaders are no longer in the mix.
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